Mortgage Market Weekly Update: October 29 - November 2, 2012

Mortgage rates continued to hover around yearly record lows again in the November 2 week.

According to Freddie Mac's Weekly Primary Mortgage Market Survey, the average 30-year fixed-rate mortgage fell 2 basis points during the week to 3.39 percent. At 3.39 percent the average rate is just 3 basis points from its yearly record low of 3.36 percent.

The 15-year fixed-rate mortgage also fell 2 basis points to 2.70 percent, putting it 4 basis points from its yearly record low of 2.66 percent.

The MBA's Purchase Index increased 1 percent but the decrease in mortgage applications signals that potential homebuyers may be awaiting the economy's direction following this week's presidential election.

In other real estate news, construction spending continued to increase and the S&P/Case-Shiller Indices reported improved price levels as the number of foreclosures decreased.

Construction spending reported by the Commerce Department was up 0.6 percent for the month and 7.8 percent annually. Residential construction accounted for 34.3 percent of the total and increased 2.7 percent from August.

The S&P/Case-Shiller Home Price Indices also showed continued improvement in housing prices in the month of August. In August, the 10- and 20-city composites increased 0.9 percent on a non-seasonally adjusted basis. For the 12-month period, the indices increased 1.3 percent and 2.0 percent, respectively.

A decrease in foreclosures also appears to be improving market prices. CoreLogic's September foreclosure report showed 2,000 fewer foreclosures in September than August and a decrease of 31 percent in the number of foreclosed homes in comparison to September 2011.

Overall, low mortgage rates, improving home prices and a decrease in market foreclosures are all good signs for the real estate market and appear to be fueling a continued housing market recovery.

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